The minimum wage made unemployment worse during the Great Depression

In a lousy economy, forcing wages above the value of the output makes employment worse. When there is currency deflation the effect is compounded. Adding another layer of minimums every couple of years and slowly gathering more employers into the minimum wage rules further compounds the effect.

If you can’t afford the staff you have, and you can’t reduce wages, then what options are left? Lay off more employees. Shrink your company.

And that’s what employers had to do in order to avoid collapse and closing their doors. You could lay off a bunch more staff or fire everyone.

Minimum wages, and especially the recurring rounds of increases in minimums, worsened and extended the Great Depression.

If you want the explanation in a short version instead of my 100 word summary, check out Ms. Shlaes article, linked above.

If you want a 498 page explanation of the damage Presidents Hoover and Roosevelt caused to the economy, check out Forgotten Man, also from Ms. Shlaes.